The Finance Ministry’s announcement this week of hikes to GST rates doesn’t signify a tighter fiscal stance, but it does add to the upside risks to inflation. This reinforces our belief that the RBI will need to continue frontloading its policy tightening. We now expect 50bp hikes at each of the next two MPC meetings.
EM Drop-In (Thurs, 7th July): Join our economists for their regular monthly briefing on the hot stories in EMs – and those that aren’t getting the attention they deserve. In this 20-minute session, topics will include the outlook for EM FX markets after the recent sell-offs. Register now.
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